Machinima Is Shutting Down, With 81 Staffers Laid Off

Machinima, which rose to prominence as an influential and lucrative multi-channel network catering to gamer culture, has laid off 81 employees and ceased operations. The company, which was acquired by Warner Bros in 2016 and at the beginning of 2019 was folded into WarnerMedia’s Otter Media, confirmed the moves Friday.

“A select number of Machinima employees remain with the company, which is now actively providing services to supercharge the combined portfolio of Otter Media,” a Machinima spokesperson said. “Machinima has ceased its remaining operations, which includes layoffs. Russell Arons remains with Machinima, and is assisting with transitional activities as she explores new opportunities.”

The 81 layoffs were confirmed via a California Employment Development Department WARN Report filing. It said they were enacted last week and take effect March 16.

Machinima on January 1 became a part of Otter Media as parent AT&T has been looking to align its related digital assets after its $81 billion acquisition of Time Warner. Otter laid off about 10% of its staff in December in a restructuring that consolidated its consumer brands under the Ellation division, which also includes the anime-focused Crunchyroll, the subscription service VRV and fellow gamer-focused Rooster Teeth.

In the fall, WarnerMedia said its was shuttering digital platforms including Korean movie VOD service DramaFever and SuperDeluxe. It announced a similar fate for cinephile streaming service FilmStruck, only to backtrack slightly after a backlash led by many A-list directors and other Hollywood figures.

The company ended up compromising by bringing back streaming for Criterion Collection titles, a component of FilmStruck’s offering.

Arons, who replaced Chad Gutstein as CEO in 2017, said at the time she came aboard she was looking to “evaluate what Machinima is and what our true north is.” She told Deadline a year ago that the management team had ruled out any subscription models, despite a challenging environment for digital video advertising.